Poverty increased 60 percent in 2022

Speaking Security Newsletter | Note n°216 | 26 September 2023

One of the major takeaways from the big report the Census Bureau released this month was that over 15 million more people were in poverty last year than in 2021, a 60 percent increase. As a share of the population, the national poverty rate climbed 4.6 percentage points to 12.4 percent (41 million people) — higher than the pre-pandemic rate of 11.8 percent. This is the first time the poverty rate has increased since 2010.

The Census Bureau attributes this sharp increase to changes in US tax policy: “[T]he tax system (which included stimulus payments and expanded refundable tax credits) in 2020 and 2021 decreased the number of people in poverty by 13.1 million and 16.0 million people respectively,” but the net impact of taxes paid and tax credits lifted only 910,000 people out of poverty in 2022.

This makes sense. After all, some of the most effective federal pandemic relief programs were tax credits, like the enhanced Child Tax Credit, or tax rebates, like the stimulus checks. After the welfare superstructure housing those programs and others was dismantled, many people suddenly started to get a lot less in return for the federal income taxes they paid. If feeding bills into the government vending machine produced a Twix bar in 2021, it spit out a bag of unsalted pretzels (if that) in 2022.

This I think helps explain why public opinion toward federal income taxes is the most negative it’s ever been. It’s not like people have ever had fun paying them, but recent survey data show a record number saying they aren’t fair. Polled right after paying their 2022 income taxes, 51 percent of respondents said the amount they pay isn’t fair, up 7 percentage points(!) when asked after paying their 2021 taxes. Federal income tax is now considered the worst/least fair tax (taking the crown from local property tax).

^Alt text for screen readers: Poverty increased 60 percent in 2022. This purple column chart shows the number of people in poverty in 2021, 25.6 million, and in 2022, 40.1 million. Data comes from the U.S. Census Bureau.

-Stephen (@stephensemler; stephen@securityreform.org)

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